Canada Housing/Debt: Trust me, I'm a landlord.

The Something Awful Forums > Discussion > Debate & Discussion > Canada Housing/Debt: Trust me, I'm a landlord.

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

tagesschau posted:

The ability to make objectively stupid decisions and still make money hand over fist is the surest sign that you're in an inflating bubble, isn't it?

I agree with your premise, but I'll point out that it's not objectively stupid. Risky is different from stupid; it's always risky, and as a result, it may also be stupid, but those two aren't directly connected.

Every investment involves some degree of risk. Everyone's saying "well, the developer is offloading all the risk to the purchasers!" Yes, of course they loving are! That's the whole point of the contract: the developer doesn't reap the full reward if the property is worth more than they sold it for, but they're protected in the event that the thing that's currently happening, happens. And if it doesn't happen, the buyer gets a great return in exchange for doing literally nothing beyond providing a deposit.

Now, would I leverage myself to do it? No, that's asking for trouble. At that point, your downside risk is far too high, unless you hedge it somehow. Take a loan under guaranteed but unfavourable terms, and now you've offloaded that risk to a lender, who is willing to take the risk based on the fact they can make a lot of money off it. Now you've cut off some of your potential upside, but you've limited your downside.

It's not rocket science, it's just that something about real estate purchases jumbles people's minds.

# ? Feb 6, 2023 23:15

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# ? May 18, 2024 05:22

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

T.C. posted:

The people that we actually want to support in this situation are not at all sophisticated actors on average and it's not reasonable to expect them to be.

It is reasonable to consult a lawyer (another lawyer, your own lawyer, if you are yourself a lawyer) if you're making a 5-figure or above deal, and unlike realtors they can actually face consequences for giving negligent advice.

# ? Feb 6, 2023 23:18

tagesschau: Sep 1, 2006; D&D: HASBARA SQUAD
THE SPEECH SUPPRESSOR

Remember: it's "antisemitic" to protest genocide as long as the targets are brown.

PT6A posted:

Risky is different from stupid; it's always risky, and as a result, it may also be stupid, but those two aren't directly connected.

I guess it depends on how many of your eggs you're putting in one basket. The difference in foolhardiness between borrowing to go all in on Oakville pre-con home futures, borrowing to go all in on AAPL, and betting it all on black at the wheel is small enough that it's not really worth ranking them in order from smart to dumb.

T.C. posted:

Part of why real estate is overpriced is because the downside risk is treated like it's zero, so people price profitability based on the 40 percent return minus debt costs.

People treat the cost of holding the asset as though it's zero, too. That fuels the perception largely in our parents' generation that it's basically impossible for a home purchase to be a bad financial decision in the long run.

# ? Feb 7, 2023 00:15

Subjunctive: Sep 12, 2006; ✨sparkle and shine✨

I was advised by a financial advisor in 1999 to not buy property in Toronto because it was overpriced and near a peak. Sadly, 22-year-old me listened.

# ? Feb 7, 2023 01:00

Femtosecond: Aug 2, 2003

What is remarkable about our (assuming we're mostly millennials here) parents' generation is that in the 1980s they experienced an interest spike that was so severe it makes the recent climb in interest rates look like nothing, and this combined with the ensuing recession nearly bankrupted anyone that was exposed to real estate and yet even having gone through all that, the appreciation of real estate since that trauma has been so good that they're committed real estate bulls.

# ? Feb 7, 2023 04:34

Purgatory Glory: Feb 20, 2005

We got a protest now, 1 day a week for 2 hours, until demands are met. Also, this poor guy went from buying 5 million in real estate to struggling to put food on the table.

https://v.redd.it/qe04brkh3nga1

# ? Feb 7, 2023 07:54

Typo: Aug 19, 2009; Chernigov Military Aviation Lyceum
The Fighting Slowpokes

Femtosecond posted:

What is remarkable about our (assuming we're mostly millennials here) parents' generation is that in the 1980s they experienced an interest spike that was so severe it makes the recent climb in interest rates look like nothing, and this combined with the ensuing recession nearly bankrupted anyone that was exposed to real estate and yet even having gone through all that, the appreciation of real estate since that trauma has been so good that they're committed real estate bulls.

I find people's memory realistically go back maybe like 5 years

# ? Feb 7, 2023 15:16

Fidelitious: Apr 17, 2018; MY BIRTH CRY WILL BE THE SOUND OF EVERY WALLET ON THIS PLANET OPENING IN UNISON.

PT6A posted:

It is reasonable to consult a lawyer (another lawyer, your own lawyer, if you are yourself a lawyer) if you're making a 5-figure or above deal, and unlike realtors they can actually face consequences for giving negligent advice.

I think the only point that people are trying to make is that these kind of high-risk contracts need to be regulated so that only idiots like that real estate lawyer get burned who should've known better.
Buying presales is extremely common-place for "normal" people who would never be allowed to do, say, high-risk options trading or whatever. Regulations exist to protect unqualified or oppressed people from burdensome contracts and I see no reason why real estate contracts should be exempt.

As another example, regulations should exist to prevent the existence of unconditional purchase agreements to protect people from their own idiotic decisions in FOMO markets.

# ? Feb 7, 2023 15:19

Precambrian Video Games: Aug 19, 2002

Boot and Rally posted:

My reading of the thread is that most people want protections for people who want a place to live. The speculators will either need much tighter restrictions or to be excluded through other means like taxing it so much to not make it worth it.

Exactly. Speculators can get hosed but people trying to buy homes to live in shouldn't have to face a gauntlet of traps designed to funnel their life savings away into the coffers of shady developers. It's not the same as losing your shirt buying the latest GriftCoin (NotAScam), which, to be clear, should also be regulated out of existence.

# ? Feb 7, 2023 16:46

Precambrian Video Games: Aug 19, 2002

I was wondering when Toronto was going to release any information about the vacant home tax and welp:

Toronto�s vacant home tax deadline extended as many homeowners fail to respond posted:

The deadline for Toronto�s new vacant home tax has been extended to the end of the month, Mayor Tory said Thursday, with about 84.5 per cent of homeowners completing the required form to declare whether their home is empty.

The city had previously indicated that homeowners who don�t meet the original Feb. 2 deadline could have their properties declared vacant and be taxed.

�Let�s remember that the most important thing about the vacant home tax is that most people will not pay it because most people are living in their homes,� Tory told reporters at an event to launch new speed cameras.

�Even people who go to Florida for a few months are living in their homes, they�re not vacant, we�re looking for those homes that are completely empty.�

The tax was introduced this year, as a measure to get unused potential units bank on the rental and real estate markets. If a property is empty, owners will have to pay one per cent of the current value assessment (CVA) of the home. If that�s $1,000,000 for example, they will need to pay $10,000 in tax.

�The point of this isn�t money, the point of this is to get housing stock that is sitting empty into people�s hands to use for housing,� Tory said.

All homeowners have to fill out the form, which they should have received in the mail but can also find online, whether or not their property is empty.

�The portal will stay open after today and we're accepting late declarations without penalties until the end of February,� said city spokesperson Alex Burke in an email.
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The city notes on its website: �a property is considered vacant if it is not used as the principal residence by the owner(s) or any permitted occupant(s), or if it was unoccupied for a total of six months or more during the previous calendar year.�

If owners don�t make the annual declaration by the deadline �and/or provide supporting documentation,� their property may be �deemed vacant,� the city website adds.

The tax is based off a similar one in Vancouver that was introduced in 2017. The total number of vacant properties there is now 1,398, 36 per cent fewer properties than when the program launched, according to a city report.

Of the 1,755 vacant residential properties in 2020, 49 per cent were converted to occupied in 2021, the report stated. Asked why the tax is so low, Tory said they learned from Vancouver�s experience.

�We�ll assess it, but we started off at a reasonably low rate similar to what they did in Vancouver where I think it worked to produce thousands of additional housing units for the people who need it, he said.

Head of government professes to not wanting revenue, announces that predicted wet fart is going to be even wetter than ever imagined from the standpoint of pant making GBS threads. Anyway, I guess some non-zero amount of people are going to pay it instead of taking the obvious step of lying or ignoring the notice and daring the city to actually do something.

# ? Feb 8, 2023 05:49

Femtosecond: Aug 2, 2003

What we've seen in BC/Vancouver is that pretty much everyone is exempt from these taxes as all but the extrordinarily wealthy sell off their pied-a-terre condos they were keeping around to small time investors that rent them out. BC government says 99% of British Columbians are exempt from the Speculation Tax. Similarly the amount of actual empty homes impacted by Vancouvers' empty home tax keeps plunging.

quote:

https://storeys.com/city-of-vancouver-empty-homes-tax-report-2021-year/
The Empty Homes Tax first came into effect in 2017, and the City says that as the tax is reaching the end of its fifth year, the amount of vacant properties in Vancouver is now at 1,398, which is 36% less compared to when it was first implemented.

The City says that 1,755 residential properties were identified or declared as vacant in 2020, but 49% of those have then became occupied in 2021.

This was the goal of the tax really to pretty much actually tax no one but to force units on to the market. Seems like it's working. Any revenue being generated is just like a nice to have.

quote:

By neighbourhood, Shaughnessy, West Point Grey, and the West End had the highest proportions of vacant homes, at 5% (but not the highest amount). Most the neighbourhoods on the eastern side of Vancouver had the lowest proportions of empty homes.

Where the empty homes are are pretty much the mansion districts of the city.

Femtosecond fucked around with this message at 19:33 on Feb 8, 2023

# ? Feb 8, 2023 19:31

Precambrian Video Games: Aug 19, 2002

Femtosecond posted:

What we've seen in BC/Vancouver is that pretty much everyone is exempt from these taxes

... and on that note:

Builders seek extension on Toronto�s new vacant homes tax posted:

Toronto region homebuilders are asking the city to extend the time they have to start paying the new vacant home tax on unsold housing units.

The 1 per cent tax on empty homes doesn�t apply to buildings under construction. But it does apply to condos or other homes that are owned by the developer if they have been vacant for more than six months in 2022 and are within the residential tax class, said Casey Brendon, director of Revenue Services with the city.

While most newly built homes are pre-sold before construction begins, builders often have some unsold inventory even after a building is occupied and has been registered on the municipal tax roll, said David Wilkes CEO of the Building Industry and Land Development Association (BILD), which represents GTA homebuilders. He met last month with councillor Brad Bradford, chair of Toronto�s planning and housing committee, a city staffer and a representative of Mayor John Tory�s office.

Wilkes said homebuilders are looking �for a reasonable extension� that respects the intent of the bylaw. �A two-year extension would certainly be something that would make sense for us,� he told the Star. The city introduced the tax as one means of discouraging owners from leaving their properties vacant while Toronto is experiencing a housing crisis.

Wilkes said it�s not clear how many unsold units are sitting empty but it could take a year or longer in current real estate market conditions to sell those empty homes. Many of them would be more expensive, larger two- and three-bedroom units, making the tax, equal to 1 per cent of the value of the home, �prohibitive.� �We are working with the city to resolve that issue and we hope that we�ll be able to do so for 2023, the current tax year,� he said. �BILD representatives have suggested additional exemption criteria that could apply to newly-built homes and residential condominium units,� Brendon wrote in an email to the Star.

At the meeting last week, �the city took note of the development industry�s feedback and will consider it. There were no decisions arising from this meeting,� Brendon said. Bradford did not answer questions on what was discussed at the meeting and what kind of amendments the industry is seeking.

Shocking that the guy from BILD can't come up with a plausible reason why they should be allowed to let unsold units sit vacant until ~market conditions improve~ and the price is right for them.

# ? Feb 9, 2023 06:21

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

Isn�t �allowing people to sit on empty property until they can get more money for it� literally the exact thing the tax is supposed to discourage, and the one and only thing it can plausibly accomplish?

IMHO, charge the developers double, and also force them to open a booth where you can pay to Spank a Condo Developer until all units are sold.

# ? Feb 9, 2023 13:58

Fidelitious: Apr 17, 2018; MY BIRTH CRY WILL BE THE SOUND OF EVERY WALLET ON THIS PLANET OPENING IN UNISON.

eXXon posted:

... and on that note:

Shocking that the guy from BILD can't come up with a plausible reason why they should be allowed to let unsold units sit vacant until ~market conditions improve~ and the price is right for them.

quote:

it�s not clear how many unsold units are sitting empty but it could take a year or longer in current real estate market conditions to sell those empty homes

Yeah lol, it's not in "current real estate market conditions", it's "at the current unsellable listed price". I assure this guy, they will sell if you lower the price tag no problem.
Maybe BILD should rent them out while they're waiting for "market conditions". You know, the exact purpose of the tax.

# ? Feb 9, 2023 14:39

Femtosecond: Aug 2, 2003

boom

quote:

Many new homes at risk, as major Vancouver developer files for insolvency

In what could be the first sign of the start of a new phase of the turbulent period in Metro Vancouver�s housing market, Coromandel Properties is insolvent, based on its new filing in the Supreme Court of British Columbia seeking protections.

In a statement to Daily Hive Urbanized, the major local real estate developer, which primarily pursues condominium projects, says it is looking to reposition itself through the stream of the Companies� Creditors Arrangement Act (CCAA).

...

Since being active with acquiring properties a decade ago, the developer has amassed a significant portfolio, with 16 active real estate projects � all located within Vancouver � now in possible risk. Many of these projects are located within the Cambie Street Corridor, including near Oakridge.

The petition, retrieved by Daily Hive Urbanized, states there is a combined total of about $700 million in outstanding debt secured against these projects, with each project subjected to various secured loans registered against the lands.

The redevelopment potential of these sites could generate a combined total of 2,000 condominium, rental, and social housing units, based on projects with an already identified scope � proposed, planned, approved, and/or under construction. This is a highly conservative figure as it does not include proposed projects that have yet to enter the formal application stage with the municipal government � projects that currently do not have a defined scope at their early stage of the proposal process � nor do they include long-term, lease-generating property investments, and projects with non-residential uses, including several future hotel properties.

The company�s leaders include Zhong Zhen Yu, who is the director, and former Vancouver city councillor Raymond Louie, who is the chief operating officer.

In the petition, the developer asserted the City of Vancouver�s expensive and slow approval processes are at least partly at fault for the firm�s precarious situation, including years-long, uncertain rezoning application reviews that involve lengthy negotiations with City staff on the allocated community amenity contributions (CACs).

�The process to develop real estate in Vancouver is complex, expensive, and slow,� reads the petition. �The process to obtain the required approvals from the City prior to commencing a Project is also slow and can take many years. It includes, but is not limited to, the Petitioners preparing proposals and plans, submitting applications for zoning and development permits, and negotiating with the City.�

�The pace of developing the various Projects has been slower than anticipated due to the lengthy application process, and the discussions with the City surrounding density potential and social housing requirements.�

The filing also states the developer has had difficulty servicing its secured debt due to the rise of interest rates since 2022. Their financing over the years to buy properties, fund the design and application processes, and perform construction has depended on a combination of secured loans, unsecured loans, and equity financing.

...

Looking around twitter, looks like a lot of vancouver developers smugly making mock surprise comments. Seems like folks knew this company was on a shaky foundation for a long time and were expecting this.

# ? Feb 9, 2023 18:32

Purgatory Glory: Feb 20, 2005

Femtosecond posted:

boom

Looking around twitter, looks like a lot of vancouver developers smugly making mock surprise comments. Seems like folks knew this company was on a shaky foundation for a long time and were expecting this.

That's the sentiment on reddit as well.

# ? Feb 9, 2023 19:53

Hubbert: Mar 25, 2007; At a time of universal deceit, telling the truth is a revolutionary act.

Femtosecond posted:

boom

Looking around twitter, looks like a lot of vancouver developers smugly making mock surprise comments. Seems like folks knew this company was on a shaky foundation for a long time and were expecting this.

👀

# ? Feb 9, 2023 20:05

Guest2553: Aug 3, 2012

We just didn't free market hard enough. Time to double down on deregulation imo.

# ? Feb 9, 2023 20:12

MickeyFinn: May 8, 2007; Biggie Smalls and Junior Mafia some mark ass bitches

Guest2553 posted:

We just didn't free market hard enough. Time to double down on deregulation imo.

Non-homeowners should pay a resource usage fee as they take up resources but contribute nothing to the local economy. That money can be sent to current owners to help them weather these dark times. The fee is counted as income for the purposes of mortgage applications.

# ? Feb 10, 2023 16:05

Hubbert: Mar 25, 2007; At a time of universal deceit, telling the truth is a revolutionary act.

MickeyFinn posted:

Non-homeowners should pay a resource usage fee as they take up resources but contribute nothing to the local economy. That money can be sent to current owners to help them weather these dark times. The fee is counted as income for the purposes of mortgage applications.

I believe that this is called the Home Owner Grant. :hmmyes:

# ? Feb 10, 2023 16:49

MickeyFinn: May 8, 2007; Biggie Smalls and Junior Mafia some mark ass bitches

Hubbert posted:

I believe that this is called the Home Owner Grant.

Yeah, but now renters get a list of names and amounts in the mail and they have to go to those people in person, apologize for leeching, and pay them in cash.

# ? Feb 10, 2023 16:55

McGavin: Sep 18, 2012

MickeyFinn posted:

Yeah, but now renters get a list of names and amounts in the mail and they have to go to those people in person, apologize for leeching, and pay them in cash.

Finally.

# ? Feb 10, 2023 16:57

qhat: Jul 6, 2015

MickeyFinn posted:

Non-homeowners should pay a resource usage fee as they take up resources but contribute nothing to the local economy. That money can be sent to current owners to help them weather these dark times. The fee is counted as income for the purposes of mortgage applications.

Okay okay that�s enough of the BC Landlords FB Group/Deep Space 9 cross posting.

# ? Feb 10, 2023 18:36

Femtosecond: Aug 2, 2003

Gonna be hard for the housing market to implode when like 50% of homeowners have zero loans whatsoever

https://twitter.com/ayan604/status/1624204736445681665?s=46&t=0m-7b1VzStwtZXwa5SCL_A

# ? Feb 11, 2023 02:03

Femtosecond: Aug 2, 2003

https://twitter.com/LeoSpalteholz/status/1624083269770956802?s=20&t=sAtplLA3nMC6kzL16mNR_w

Bringing some "are investors the problem?" conversation here from the Canada D&D thread, seems like there's not much correlation one can discern between investors and real estate prices. The biggest takeaway for me is that the big university towns of London (Western) and Kingston (Queens) have a lot of investors to supply the housing for all the students that can't possibly be expected to be buyers.

# ? Feb 11, 2023 02:09

MickeyFinn: May 8, 2007; Biggie Smalls and Junior Mafia some mark ass bitches

Femtosecond posted:

Gonna be hard for the housing market to implode when like 50% of homeowners have zero loans whatsoever

https://twitter.com/ayan604/status/1624204736445681665?s=46&t=0m-7b1VzStwtZXwa5SCL_A

What fraction of houses are sold every year? That is what matters. I�m guessing it is one percent or less. So a small fraction of homeowners needing to sell can be very large compared to the market.

# ? Feb 11, 2023 02:18

qhat: Jul 6, 2015

What is the net worth of houses that are currently financed?

# ? Feb 11, 2023 03:43

qhat: Jul 6, 2015

Or should I say, current total outstanding finance relative to cumulative most recent sale price of all houses that are free of finance.

# ? Feb 11, 2023 03:46

T.C.: Feb 10, 2004; Believe.

MickeyFinn posted:

What fraction of houses are sold every year? That is what matters. I’m guessing it is one percent or less. So a small fraction of homeowners needing to sell can be very large compared to the market.

That would imply that the average residential property, including condos, is held for a hundred years or more.

Don't know the number and a two second Google didn't tell me but you are likely off by an order of magnitude

# ? Feb 11, 2023 04:22

Precambrian Video Games: Aug 19, 2002

~40k sales/month = 480k/year = ~3.5% of the ~14M homes in the country, some ~2M of which are purpose-built rental and not really eligible to be sold (so more like 4% of those that can be sold).

# ? Feb 11, 2023 04:31

MickeyFinn: May 8, 2007; Biggie Smalls and Junior Mafia some mark ass bitches

eXXon posted:

~40k sales/month = 480k/year = ~3.5% of the ~14M homes in the country, some ~2M of which are purpose-built rental and not really eligible to be sold (so more like 4% of those that can be sold).

Nice. Thanks for looking that up. So 1% more of all houses going on the market sounds like an increase in �supply� of 25%. I don�t think the 50% who don�t owe anything matters to a market crash.

# ? Feb 11, 2023 05:25

tagesschau: Sep 1, 2006; D&D: HASBARA SQUAD
THE SPEECH SUPPRESSOR

Remember: it's "antisemitic" to protest genocide as long as the targets are brown.

Femtosecond posted:

Gonna be hard for the housing market to implode when like 50% of homeowners have zero loans whatsoever

Yeah, it's not like price discovery occurs entirely at the margins or anything. :rolleyes:

Femtosecond posted:

seems like there's not much correlation one can discern between investors and real estate prices

Cool, now adjust it for median household incomes so it might actually be possible to draw the claimed conclusion.

I'm not sure why you're pushing the number-go-up narrative increasingly hard despite the lack of evidence for it. I just wanted to note explicitly that you're doing so.

# ? Feb 11, 2023 07:33

Arivia: Mar 17, 2011

tagesschau posted:

Yeah, it's not like price discovery occurs entirely at the margins or anything.

Cool, now adjust it for median household incomes so it might actually be possible to draw the claimed conclusion.

I'm not sure why you're pushing the number-go-up narrative increasingly hard despite the lack of evidence for it. I just wanted to note explicitly that you're doing so.

shut up tagesschau

(USER WAS PUT ON PROBATION FOR THIS POST)

# ? Feb 11, 2023 07:54

tagesschau: Sep 1, 2006; D&D: HASBARA SQUAD
THE SPEECH SUPPRESSOR

Remember: it's "antisemitic" to protest genocide as long as the targets are brown.

Arivia posted:

shut up tagesschau

gently caress off, bigot.

(USER WAS PUT ON PROBATION FOR THIS POST)

# ? Feb 11, 2023 08:18

Powershift: Nov 23, 2009

This article on investor-owned houses in Canada has a bunch of colourful charts.

https://www.cbc.ca/news/canada/british-columbia/housing-investors-canada-bc-1.6743083

I'm starting to think there may be a problem.

# ? Feb 11, 2023 19:19

COPE 27: Sep 11, 2006

I wish houses existing on the rental market was a thing so I could rent something bigger than 800 sq feet

# ? Feb 11, 2023 20:07

Femtosecond: Aug 2, 2003

MickeyFinn posted:

I don�t think the 50% who don�t owe anything matters to a market crash.

I think it matters only so much as a broader discussion around the broader economy-wide impacts of further interest rate hikes.

We've been reading all these alarming articles about new buyers stretched to the limit who are getting utterly destroyed by variable interest rates, but meanwhile a huge chunk of the population's only concern right now is that the price of eggs is up.

Basically if variable rates keep rising and blow up a bunch people at the margins, that can send prices tumbling, but if it's a relatively small amount of people does that mean the impacts on the greater economy are contained?

When I said earlier "Gonna be hard for the housing market to implode" I should have been more precise in what I was saying here, because like absolutely prices can sink sure, I expect them to in the short term, but like is Canada in a position to avoid sinking prices inducing broader recessionary problems?

Just having a look and it seems like the USA broadly here is more indebted than Vancouver which maybe sort of makes sense given that it's a pretty good deal to be a mortgage holder in the USA so why not.

quote:

...the share of owner-occupied households with no mortgage has climbed to 37.1 percent over the same nine-year period.

https://www.urban.org/urban-wire/mortgage-debt-has-peaked-why-has-share-homeowners-mortgage-fallen-13-year-low

Maybe none of this really matters and it's not a metric that means much.

# ? Feb 11, 2023 21:21

Precambrian Video Games: Aug 19, 2002

tagesschau posted:

Yeah, it's not like price discovery occurs entirely at the margins or anything.

Cool, now adjust it for median household incomes so it might actually be possible to draw the claimed conclusion.

I'm not sure why you're pushing the number-go-up narrative increasingly hard despite the lack of evidence for it. I just wanted to note explicitly that you're doing so.

There's no need for the snark, even if the fact that half of homeowners have their mortgages paid off doesn't really seem to say a lot about the odds of a housing price crash or not.

The "claimed conclusion" is that there isn't much correlation between investor ownership percentage and housing price, which is apparently true, but if you have an obvious explanation for why this doesn't matter or what the causation is here, do share.

To some extent, it makes sense that even investors would be priced out of expensive markets and resort to cheaper cities if they're that set on becoming landlords. On the other hand, I don't really see how "there are more investors in London, Ontario so they're not a problem in Toronto" is a slam dunk. Easy debt fueled price increases nearly everywhere, even if they're most dramatic in CMA Vancouver/Toronto.

# ? Feb 11, 2023 21:24

tagesschau: Sep 1, 2006; D&D: HASBARA SQUAD
THE SPEECH SUPPRESSOR

Remember: it's "antisemitic" to protest genocide as long as the targets are brown.

eXXon posted:

There's no need for the snark, even if the fact that half of homeowners have their mortgages paid off doesn't really seem to say a lot about the odds of a housing price crash or not.

The "claimed conclusion" is that there isn't much correlation between investor ownership percentage and housing price, which is apparently true, but if you have an obvious explanation for why this doesn't matter or what the causation is here, do share.

To some extent, it makes sense that even investors would be priced out of expensive markets and resort to cheaper cities if they're that set on becoming landlords. On the other hand, I don't really see how "there are more investors in London, Ontario so they're not a problem in Toronto" is a slam dunk. Easy debt fueled price increases nearly everywhere, even if they're most dramatic in CMA Vancouver/Toronto.

The reason the scatterplot isn't very useful is that it doesn't show prices relative to the CMAs' median household income, which would give you some clue as to whether the homes are overpriced or not, and how far the debt-fueled speculative mania has driven them up beyond their sustainable value. It's not particularly helpful to drop it into the thread in an attempt to prove that number is not being propped up artificially by forces that will necessarily disappear under more normal interest rates.

# ? Feb 11, 2023 21:50

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# ? May 18, 2024 05:22

Femtosecond: Aug 2, 2003

Powershift posted:

This article on investor-owned houses in Canada has a bunch of colourful charts.

https://www.cbc.ca/news/canada/british-columbia/housing-investors-canada-bc-1.6743083

I'm starting to think there may be a problem.

This article is another example of what I was talking about in the D&D thread in like how this issue around Investors in housing is weirdly framed by the media as this issue wholly around denying first time homeowners their rightful homes.

(I mean this is pretty much the underlying premise of this whole thread too)

There is a clear core underlying problem here in that there's not enough good purpose built rental housing, whether market or non-market, private or government owned being built in this country, but that is not the problem that is being expressed by the media.

The problem seems to only be that Other People Are Trying To Buy The Home I Want To Buy.

quote:

Experts say the figures raise questions about whom new houses are being built for, and how capital may be distorting the housing market across a country in the grips of an affordable housing crisis.

Um the homes are built for renters. There is a huge amount of people that cannot afford to buy a home that also need somewhere to live.

Here we see the notion raised that renters having homes to live in is "distorting" the market apparently, which is presumably naturally wholly homeowners.

If it weren't for those darn renters existing I'd be able to buy that house for a few thousand less. *shakes fist*

quote:

"What this dataset does is that it shows a competition to get on that [housing] ladder," said Andy Yan, director of Simon Fraser University's City Program.

"For Canadian public policy at the federal, provincial and local levels, who should have priority in trying to get on that ladder?

Where are those that have no hope in hell at ever getting on the ladder supposed to live? Are they allowed to have housing?

You could find and replace "Investors" and replace them with "Renters" and the tone of the article changes remarkably and becomes rather dull. Because of course there's renters because renters need somewhere to live as well?

quote:

Statistics Canada data shows that more than a fifth of all houses in British Columbia, New Brunswick, Nova Scotia and Ontario were [occupied by renters] in 2020.

The data shows that condominiums in particular � which constitute a majority of newly-built houses in B.C. and Ontario � are [occupied by renters] in high numbers. Over a third of all condos in B.C. are [occupied by renters], with the number jumping to 41.2 per cent in Ontario.

Wow ur telling me that there's lots of renters in condos, the only sort of new housing that's been viable to build for decades on decades? Wow shocking.

Ostensibly the point being driven at here is that if the Investors went away then the price of homes would go down. Sure. But where are those without an enormous gifted down payment supposed to live? Who knows who cares apparently.

Mark Lee almost touches on the actual issue here, which is that Canada's tax code has apparently made it such that it's only profitable to make condos, thus the only housing product that is viable to build at all for renters is one where people can also owner occupy.

quote:

Marc Lee, senior economist at the Canadian Centre for Policy Alternatives, says changes in tax codes in the late 1980s and early '90s incentivized developers to build condos over detached homes.

Statistics Canada found that, from 2019 to 2020, 54.4 per cent of all new houses in B.C. were condos. In Toronto alone, that figure is 59 per cent.

Very briefly mentioned as well is something that that the pool of investors is necessarily growing because housing is becoming so incredibly expensive that the only way people can afford to buy a SFH at all is if they rent out part of it

quote:

B.C. has the highest rate of "investor occupants" which refers to someone who lives in a single property with multiple residential units � such as "mortgage helpers" or Vancouver specials.

Would be very nice if we had a huge amount of purpose built rentals being built and renters didn't have to live under the thumb of mom n' pop small business tyrant landlords. I think I've read somewhere that typical rents are a bit less in dedicated PBRs too.

There would still be the same amount of Investor money flowing into housing, and renter housing would still be owned by investors, but I guess if it's off to the side and not visibly competing with the upper middle class it wouldn't be a problem for the Star/Globe/CBC and not worth writing an article about.

# ? Feb 11, 2023 21:54

The Something Awful Forums > Discussion > Debate & Discussion > Canada Housing/Debt: Trust me, I'm a landlord.

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